Beware the perils of a Fair Trade monopoly

24 Feb 2014

Philip Booth appears on BBC Radio Four

IEA Editorial and Programme Philip Booth appeared on BBC Radio Four's Food Programme with IEA author Sushil Mohan discussing the future of Fair Trade. This was in response to proposals to introduce a new Fair Trade label. Sushil discussed that the benefit associated with selling products Fair Trade is only similar to that which sells within a niche market, only slightly increasing their premium by a marginal amount. This is compounded by the fact that the Fair Trade share in the global food and beverage market is approximately 0.01 percent.

Philip discussed the ethics of the Fair Trade movement and the extent of 'Fair Trade absolutism', where communities are encouraged to do everything they can to sell Fair Trade goods, crowding out other organisations such as the Rainforest Alliance. Via their promotion, competition is limited producing a Fair Trade monopoly which seems unethical given that Fair Trade was against this monopoly power by transnational companies.

Furthermore, Philip argues there is a danger that the Fair Trade movement squeezes out other organisations such as the Rainforset Alliance, or forces producers to adopt standards which may not suit their interests because of pressures from western consumers. He recommends that consumers and producers will be better off buying speciality brands to help farmers, rather than buying fair trade products.

You can listen to the full programme here. Philip and Sushil's segment begins at 17.30.